Should we worry about Huawei?

BBC.- Huawei, the Chinese telecoms giant, has hit the headlines over the arrest of the founder’s daughter in Canada for extradition to the United States. But the firm, which manufactures a range of technology from network equipment to mobile phones, is on the agenda for other reasons too.

Some Western governments have blocked telecoms companies from using Huawei gear in new communications networks, citing security concerns.

So far the UK has held back from any formal ban. So does the firm pose a threat?

What is Huawei?
The company started out making equipment for mobile phone networks and has grown rapidly, eclipsing the likes of Nokia and Ericsson, to become a global leader.

More recently it has started making smartphones as well and has captured about 15% of the global market, second only to Samsung and ahead of Apple.

The firm’s founder Ren Zhengfei, a former People’s Liberation Army officer, started Huawei in 1987. It’s based in Shenzhen, Guangdong and is owned by 80,000 of its 180,000 employees.

So is Huawei a security threat?
The US points to Mr Zhengfei’s military background and its growing global role to argue it represents a risk to national security.

In principle, controlling the technology that sits at the heart of vital communications networks gives Huawei the capacity to conduct espionage or disrupt communications during any future dispute, particularly as more things, from autonomous vehicles to domestic appliances become connected to the internet. Countries using Huawei equipment monitor such risks carefully.

But the US also points more generally to China’s National Intelligence Law passed in 2017 that says organisations must “support, co-operate with and collaborate in national intelligence work”.

As a result, the US, Australia and New Zealand have all blocked local firms from using Huawei to provide the technology for next-generation 5G mobile networks.

That’s three of the five so-called “Five Eyes” intelligence sharing community. A fourth, Canada is reviewing its relationship with the firm.

The UK has not taken a position, although it is also coming under pressure from the US to do so.

Why hasn’t the UK blocked Huawei?
The UK government has admitted to “strains” in the relationship with Huawei. The body tasked with overseeing internet security in Britain, the National Cybersecurity Centre, has asked Huawei to fix problems that pose “new risks” to the network.

Moreover, Alex Younger, the head of the UK’s intelligence service MI6, has suggested that “some decisions” lie ahead over Huawei’s role because 5G networks will make it harder to monitor security.

BT has announced it is in the process of removing Huawei’s equipment from the core of its existing 3G and 4G mobile operations and will not use the Chinese company’s gear in central parts of the next 5G network.

But Huawei has been providing technology to UK firms for more than a decade and Britain is keen to maintain a good relationship with China on trade and investment as it prepares for Brexit.

Most of the country’s mobile networks – Vodafone, EE and Three – have already been working with Huawei to prepare their 5G offerings and it might not be easy to change that at short notice.

What does Huawei say?
The company is keen to portray itself as a firm with no ties to the Chinese government. It says it prioritises safety and security when supplying technology and that at least some of the hostility towards it is because the firm poses a competitive threat.

In the past the Chinese government has also argued that moves to block the firm’s products amount to “protectionism” and “discriminatory practices”.

The new hostility towards Huawei comes against a backdrop of heightened tensions between the US and China, with President Trump accusing Beijing of unfair trade practices and of facilitating the theft of intellectual property from US firms.

Furthermore as several countries simultaneously plan to introduce faster 5G networks, the stakes are high for firms that win contracts.

Emily Taylor at Chatham House said there was a “standards war” going on behind the scenes.

“I think the trade advantage from setting standards that favour your own domestic suppliers’ technologies also plays a part in this,” she told the BBC.